IYG vs SPY
iShares US Financial Services ETF vs State Street SPDR S&P 500 ETF Trust
Quick Verdict
SPY has a lower expense ratio. SPY delivered stronger 1-year returns. SPY offers more diversification with 505 holdings.
Side-by-Side Comparison
| Metric | IYG | SPY | Winner |
|---|---|---|---|
| Expense Ratio | 0.38% | 0.09% | |
| AUM | $2.2B | $821.1B | |
| Dividend Yield | 1.03% | 1.01% | |
| Holdings | 104 | 505 | |
| YTD Return | +4.75% | +12.68% | |
| 1Y Return | +12.35% | +21.82% | |
| 3Y Return (annualized) | +24.24% | +21.98% | |
| 5Y Return (annualized) | +10.57% | +12.89% | |
| Volatility (annualized) | 21.6% | 15.3% | |
| Max Drawdown | -82.9% | -56.5% | |
| Fund Family | iShares by BlackRock (US) | State Street Investment Management | |
| Category | Equity | Equity | |
| Inception | Jun 12, 2000 | Jan 22, 1993 |
IYG vs SPY Performance
iShares US Financial Services ETF (IYG) is a ETF from iShares by BlackRock (US) and State Street SPDR S&P 500 ETF Trust (SPY) is a ETF from State Street Investment Management. Over the past year IYG returned +12.35% while SPY returned +21.82%. Year to date, IYG is up 4.75% versus a gain of 12.68% for SPY.
Over three years, IYG compounded at +24.24% per year against +21.98% for SPY; over five years the annualized figures are +10.57% and +12.89% respectively. Across the full 26-year window we track, SPY has the edge at +8.81% annualized vs +5.31%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
IYG has been the more volatile fund, with annualized monthly volatility of 21.6% compared with 15.3% for SPY. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -82.9% for IYG and -56.5% for SPY. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.82. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
IYG charges 0.38% per year while SPY charges 0.09%. On a $10,000 position that is $38 vs $9 annually, a gap of $29 per year that compounds over a long holding period. On income, IYG currently yields 1.03% against 1.01% for SPY.
Holdings Overlap
IYG and SPY share 45 holdings out of 560 unique holdings combined, representing a 8.9% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, IYG or SPY?
IYG has an expense ratio of 0.38% while SPY charges 0.09%. SPY is the cheaper option. On a $10,000 investment, that is $29 per year of difference.
Which performed better, IYG or SPY?
Over the past year IYG returned +12.35% vs +21.82% for SPY, so SPY leads on 1-year performance. Over the longest common window we track (26 years), IYG annualized +5.31% vs +8.81% for SPY. Past performance does not guarantee future results.
Which is riskier, IYG or SPY?
IYG has been the more volatile fund at 21.6% annualized versus 15.3% for SPY. Worst drawdown: IYG -82.9% vs SPY -56.5%.
Should I hold both IYG and SPY?
IYG and SPY have a monthly-return correlation of 0.82, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between IYG and SPY?
IYG and SPY share 45 common holdings with a 8.9% weight overlap. Combined, they hold 560 unique securities.
Which pays a higher dividend, IYG or SPY?
IYG yields 1.03% while SPY yields 1.01%, so IYG currently pays the higher dividend yield.
Popular ETF Comparisons
Get Full ETF Analytics
Access complete holdings data, overlap analysis, screener tools, and more with FundXLS.